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Hosted storage and compliance are hot topics in the storage market of late, and storage analysts predict that the focus for data backup and electronic archiving products will shift toward storage service providers large and small.

According to Greg Susco, vice president of Telamon Insurance & Financial Network, an independent insurance broker, offering backup SaaS to property and casualty insurance customers might seem off the beaten path. But he decided to resell AmeriVault Corp. services administered through Telamon, at a discount to its clients, in the hopes of attracting new business.

Clients of Telamon can get up to 10 GBytes of storage for $179 a month and have a special install fee of $149 (the regular install fee starts at $195). AmeriVault was cagey about its base pricing details, but a company spokesperson said that Telamon customers are generally receiving a 30% discount across the board.

"We're not making any money on this service," Susco said. "It's a value-add for potential customers to show that we want to be a business partner with them and help them recover from disasters."

Susco said data is becoming as much a part of an insurance company's purview as physical facilities when it comes to insuring businesses. "We also offer our own online tools for disaster recovery, and resources, like safety manuals and sample documents, to help customers develop their own DR plans."

Of course, just because it's offered doesn't mean customers will necessarily come. "We're at the very early stages with this," Susco said. (The Telamon service was first rolled out and announced on Monday). So far, just one client has signed up for the service, managing around 400 GB of data.

ISP adds archiving

Meanwhile, just south of Dallas, an Internet service provider (ISP) is branching out into data archiving with a new product from Zimbra Inc., an open source messaging company.

AirCanopy serves mainly K-12 school districts, and their budget constraints pushed Kenyon in the direction of an open source product to keep his prices low. Zimbra also offers discounted prices for education and government institutions for its email, which Zimbra declined to disclose. However, according to Kenyon, such customers are receiving an additional 50% discount over the email price on the archiving product. (List price for Zimbra's archiving product is $24 per user per year.)

Kenyon said archiving is becoming an issue for school districts following an announcement last month that it will be expected to comply with the new Federal Rules of Civil Procedure (FRCP) beginning in December 2007 (commercial businesses were expected to be in compliance as of December 2006). With backup plans now potentially subject to subpoena, these rules have been cited as one of the big reasons archiving in general has become such a hot topic in storage in recent months.

"School districts get into more litigation than you'd think," Kenyon said. "And now they're being asked to respond to new regulations" that may be beyond their financial or administrative means.

Meanwhile, any IT service provider needs a datacentre and bandwidth, two things Kenyon said are a natural fit for a storage ISP. "I think you're going to see a general trend of more rules, more archiving, more outsourcingand more ISPs getting into the compliance game," he said. "And I think [established storage] companies like EMC Corp. are going to price themselves out of what small business [customers] can afford."

Kenyon admitted storage outsourcing will still be a tough sell to many customers. "Sometimes the liability hurdle is one you don't get over," he said. "But in many cases, it's a better alternative to not having any compliance [procedures] in place at all."

Zimbra has SaaS in its sights

Zimbra's new software, which will become generally available July 23, has most of the items on the email/archiving checklist, including automatic .pst file discovery and migration, and the ability to index, search and export messages or mailboxes for e-discovery and compliance purposes.

Where it differs from other products is the fact that it can support multiple platforms, including Exchange, Lotus, Domino and GroupWise, as well as its own email application, and can support messages from any combination of those applications in the same repository, the company claims. The software also allows attachments to be quickly rendered in HTML rather than requiring full downloads. Zimbra's single instancing is slightly behind some of its competition; messages and attachments carbon copied to multiple recipients are not saved more than once, but identical messages and attachments sent separately to more than one recipient will be stored multiple times.

According to Zimbra's president and chief technology officer, Scott Dietzen, times are changing in his market, as well. Over the last year, he said, Zimbra's primary competitors in email and collaboration products have shifted from various products by Sun Microsystems Inc. and Mimosa Systems Inc.'s NearPoint archiving software to Google's Gmail, particularly in the education sector. Meanwhile, Dietzen estimated that 25% of the 1,000 customers signed up for Zimbra's premium service (the company also offers a completely free open source version of its software) are Software as a Service (SaaS) providers themselves.

"I've seen a dramatic uptick in interest in SaaS" for email, Dietzen said. As a mission-critical system that's difficult to manage, but doesn't actually produce revenue for most companies, email is a ripe target for outsourcing, he added. Archiving, which also fits that description, is a natural follow-on to an email service. "There is some cost savings involved with using a large-scale [storage] system from a service provider, but I think complexity, especially around compliance, is what's really driving SaaS."

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